Let me begin with a story.

In the winter of 1991, like many here in America, I sat glued to CNN’s coverage of the historic toppling of the statue of infamous founder of the KGB in Dershinky circle near the Kremlin. Little did I know or suspect that 6 months later I would be delivering a seminar to 200 Russian businessmen in Moscow on the use of market research and surveys in developing positioning and branding strategies for advertising, marketing and public relations campaigns.

As it turned out there was a member of the Russian Government in the audience–a Lt. Colonel from the Russian Ministry of Internal Affairs–the Russian National police. He approached me after my talk, told me how much he had enjoyed it and asked if I would meet with his superior at the Ministry the following day. I looked at my wife, who was with me at the time. She gave me the “Hey, why not?” smile” and we agreed.

And so, the next morning she and I and the Colonel stood in front of the Ministry Headquarters (a huge yellow and white cement structure) awaiting security clearance. Finally uniformed guards came out. They ushered us down long, dark, cement corridors, up four flights of stairs (the elevator was broken) and into the office of Colonel Stanislav Pylov, the Director of Personnel for the Ministry of Internal Affairs of the Russian Federation. This man was in charge of the welfare of a million Russian police (they are all federal police in Russia).

We were introduced and made small talk while we nibbled on cookies and sipped a hardy Russian tea. Finally I said “Colonel Pylov, I came to Moscow with some other American businessmen to help open up a business college here how can I help you?”

He got right to the point. “We had 356 policeman killed in the line of duty last year. We must improve the public’s opinion of the police. Can the survey technology you use help us do that?”

I said that it could. With that Pylov broke into a huge smile and stood up. He said that this was the beginning of a new relationship between Russia and America and went to a closet and brought out a beautiful wooden clock and gave it to my wife. The hair stood up on the back of my neck. My imagination ran wild–World Peace; Reagan, Gorbachev, On Target Research!

As it turned out, this was the beginning of a series of seminars and workshops I did for the Ministry over the next year on the use of surveys in public relations efforts. Bear in mind that these guys had a SERIOUS PR problem. They had been beating people over the head with night sticks as the primary communication line with the public for 70 years, and now wanted to improve their image. The first thing of course was a major program in personal communication by the police and it went from there.

But that is not the point of the story. Because of this initial relationship with the Ministry, I made several trips to Russia in the ensuing years. On one occasion I had been invited to speak to a large group of Russian bankers on the use of market research and surveys in advertising and PR campaigns. And as a matter of pure coincidence, a day or two before I was scheduled to leave, USA TODAY ran a 16 page color supplement that was essentially a large advertisement placed by a number of Russian businesses and banks soliciting (desperately needed) US deposits and investment dollars.

As I read the ads, particularly those placed by the banks, I was astounded. I don’t know how many millions of rubles the various companies shelled out for this ad but it had to have been plenty. Just converting rubles to US dollars was, in itself, a Herculean task in those days to say nothing of actually coming up with the money. The crime was that someone had sold these companies this expensive ad space and they didn’t have a clue how to advertise or position themselves–not a clue.

This is not a sob story about how these poor Russian bankers got taken advantage of–it is a marketing point. Here was a golden opportunity for these Russian banks to position themselves in the minds of American businessmen in a manner that might attract hard currency deposits and they did just the opposite.

One bank, positioned itself as “The Youngest Central Bank in the former Soviet Union”. Excuse me, banks are not suppose to be young (and thus) inexperienced and even if they are that is not something one would promote. Banks are supposed to be stable, secure, safe. This comes with longevity, consistency, permanency. This bank could just have well taken out an ad that said, “If you want to take a chance that we will still be here next month, open an account”.

Another bank showed a picture of a lighthouse and positioned itself as a beacon in a storm of financial uncertainty. Well, the beacon part was not bad, clever in fact. But both the graphics and the copy focused on the storm of financial uncertainty. From the viewpoint of an American businessman, beacon or no, why would I even head into that storm when the weather over here was quite pleasant, thank you?

The reason businessmen from Western countries were interested in Russia in the early 90s was OPPORTUNITY. Proper surveys would have found this and a sharp bank who knew its market research would have found what image represented opportunity to this public and so positioned itself as the Gateway to Russian Opportunity or the like. But this kind of market research was about as understandable as Martian to Russian bankers at that time.

You see a communications campaign without a positioning strategy is (to continue the metaphor) like a ship without a rudder. Moreover, this lack of understanding of how to position oneself is not the sole province of our new “comrades” in marketing. Indeed, I am constantly amazed at the enormous sums of advertising and PR dollars that are poured into media campaigns by individuals and companies large and small here in America that have no positioning whatsoever. They may not be as self defeating as “The Newest Bank in the former Soviet Union”, but many lack any positioning strategy at all–the most crucial element of any communications campaign.

I recently talked to a corporate marketing director of a huge international technology company. He had very little idea of the most basic positioning concepts, where they came from or how to use them.
What is Product Positioning?

And so this situation begs the question, What is positioning? Where did it come from? And how do you “do” it?

It all started with a couple of guys named Trout and Reis. Beginning in 1969 and then into the early 70s, these two young marketing geniuses, Jack Trout and Al Ries, wrote, spoke and disseminated to the advertising and PR world about a new concept in communications called positioning. Until then, agencies had primarily been basing their media campaigns on internally conceived benefits of the client’s product.

These campaigns may have been creative, they said, but they would simply no longer get the job done in what had become a heavily over communicated society. There were too many products, being pushed by too many advertising dollars on too many media lines and the prospect’s head was just too full of everyone’s noise for the old kind of advertising to get through and make any kind of impact.

The game had changed, said the boys. If you wanted to reach your prospect, the focus of your campaign could no longer be based on internally conceived benefits,- what management thought was cool -, the target was now the mind of the prospect. You had to focus on the perceptions of the prospect. You had to find a place in the mind of your public in which to put your product.

This was positioning.

Trout and Reis described positioning as follows:

“… positioning is not what you do to a product. Positioning is what you do to the mind of the prospect. That is, you position (place) the product in the mind of the prospect.”

The way you do that is to tie the product or service to something that is already in the mind. In so doing, you are able to instantly communicate to an audience about something about which they had previously been unfamiliar.

Indeed, business management expert, L Ron Hubbard later researched and wrote about the philosophic basis of positioning and what made it work.

THE UNFAMILIAR IS RAPIDLY INTRODUCED OR COMMUNICATED BY COMPARING IT TO A FAMILIAR.

“Joe knows nothing about practice boxing gloves and there are none there to show him and he will be fairly satisfied if he is given a familiar object, pillows, to compare them to.

And

“Positioning takes advantage of the fact that one can compare the thing he is trying to get the other person to understand with desirable or undesirable objects.”

This technique lets you cut through the noise of the competition and all the other communication messages your audience is being pounded with daily.

This is done by screenwriters and others in Hollywood all the time. It is how they pitch scripts and story ideas. This was humorously depicted in the Robert Altman film of some years ago called THE PLAYER. Periodically during the film they would cut to some screenwriter pitching a story idea to a producer or studio exec.

“Okay, Okay it’s like Patton but in outer space.”

My daughter, who is a budding film producer in town, recently got a script she likes and is shopping it around.

“What’s the story? What’s it like?” I ask.

“Oh, it’s kind of a female Sling Blade, ” says she.

Now this may or may not be the stuff of huge movie grosses or even critical acclaim, we’ll leave that to Roger Ebert. But, having seen Sling Blade, I instantly had the concept of the movie. It was related to something in my mind. Something with which I was familiar.

A friend is telling me about a great new book he is reading. “What’s it like?” I ask.

“It’s a Tom Clancy like story from the viewpoint of Russia’s ‘new’ KGB.”

Okay, I’ve got a concept of the book.

This, of course, is also is woof and warp of politics.

The person is a “Reagan Republican”, a “Kennedy Democrat”.

Or you can position something as better or worse than what is in the mind. She’s to the left of Karl Marx, slightly to the right of Genghis Khan, richer than Rockefeller.

The Easy Way to Position a Product

The easy way to position a product is to get into the mind first. The first product into the mind will usually dominate the category and be very difficult to dislodge. Coke in COLAs. Bayer in aspirin. Disney in theme parks. Kleenex in tissues. Philadelphia in cream cheese. Webster in dictionaries. Pitney Bowes in postage metering. And Gillette in razor blades to name a few. These guys got into the mind first and their product itself becomes the icon of the category. As such, they are very difficult to dislodge as the leader.

In the old days you never even mentioned the competition. But again, positioning requires that you relate the product or issue to something that is already in the prospect’s mind–something with which they are familiar–and one way to do that is relate your product to the leader.

The most famous of the early positioning campaigns of this nature was the “against” position taken by Avis against Hertz. They wisely didn’t try to take Hertz head on, they said

“Avis is only No. 2 in rent-a-cars, so why go with us? We try harder.”

Avis had lost money for 13 years in a row until they acknowledged that they were number 2 and as such would try harder. A masterful position. And they started making money immediately.

Trying to take the leader head on usually results in marketing suicide. When no less a company than RCA announced that they were going to take on IBM in computers in the 1970s, Robert Sarnoff said that he expected it would take them a year to get to be #2 in the computer industry. A year and $250 million dollars later RCA walked away with its tail between it legs.

Why? IBM had the computer position in the minds of the public. IBM meant computers. RCA meant radio, TV, records–they had the communication position in the public’s mind.
What If You’re Not First?

What if you’re not Disney or Gillette or CNN? Is there a way to take market share from a leader? The Avis example demonstrates that there is, and that is by finding a position that is available in the mind of your public.

“To find a unique position, what you must do is look inside the prospect’s mind. You won’t find an ‘uncola’ idea inside a 7-Up can. You find it inside the cola drinker’s head.” Said Trout and Reis.

Here are some unique positions, which carved out handsome market share for the products or services that were being marketed into categories already full of products.

VW took an immensely successful “small and ugly position” in the late 60s and early 70s (which you may have noticed, they have recently returned to after trying unsuccessfully to move out of the small position. VW means small car).

Virginia Slims created a distinguishing “gender position” in the cigarette market.

Budget Rent a Car has a “low cost or economy position” in rental cars; Circuit City has this position in retail electronics, Motel 6 has it in hospitality.

At the other end of the price spectrum, a few brands with a “top-of-the-line/luxury position” are; Rolls Royce in automobiles, Ritz Carlton or the Four Seasons in hospitality, Chivas Regal in scotch, and Sax Fifth Avenue in retail, Tiffanies in Jewelry, Mont Blanc in pens.

Head and Shoulders took a huge bite out of the shampoo market with the “anti dandruff” position.

The NASDQ has the technology position among stock exchanges.

Locations have positions (places in the mind). Entertainment = Hollywood; Family vacation = Orlando; Casinos and entertainment = Las Vegas (but a long standing and aggressive PR effort is working to change that position to a more family-oriented vacation destination).

So do people. Who do you think of when I say “Interest rates”? “Golf”? “Ice Hockey”? “Cuba”? To most, these names will instantly conjure up–Alan Greenspan, Tiger Woods, Wayne Gretsky and Fidel Castro (sounds like a Manhattan law firm–Greenspan, Woods, Gretsky & Castro.)

But most products and services don’t have that kind of instant name recognition and are competing in or being introduced into very highly competitive marketing environments. More competitive by far than when Trout and Reis first wrote about the need for positioning. Indeed, a recent report published in Iconocast notes that by 2005 internet users will be besieged with 3,000 advertising messages every single day–about 1,000 on line and 2,000 off line. Assuming 16 hours a day of ears and eyeballs, that’s 3 ads a minute ALL DAY LONG. This gives one some idea of the challenge of finding a unique position for a product or service and then getting it communicated.

It takes the average person ¼ of a second to decide whether or not they are going to read your message or throw it in the trash (or turn the page). An ad must communicate instantly. If you look at an ad and don’t get a communication right now the advertiser has missed the boat. That doesn’t mean that at some point some people might not read it, but the large majority will pass it by and your marketing and advertising dollars will have been wasted or at the very least provide you with a meager return.

Narrowing the Focus

One of the ways to facilitate a strong position is accomplished by doing the opposite of what most marketers want to do. Most sales and marketing staff want to try to be all things to all people. This may provide some short-term benefit, but it clearly weakens the brand and the position in the long run. You strengthen your brand by narrowing your focus.

Some examples from Al Reis’ 22 Immutable Laws of Branding make the point.

Chevrolet used to be the number one selling car in America. It had a “reliable and reasonably priced” position. In 1986 they sold 1,718,839 cars. But expanding their line and trying to be all things to all people undermined the power of the brand. Chevys are all over the spectrum today with countless sub-brands and now they sell less than a million cars a year. They have fallen to second place behind Ford.

In 1988 American Express offered a few credit cards and had the position as the prestige credit card and 27 percent of the market. Then it expanded its product line–a senior card, student card, membership miles card, Optima card, Optima Rewards card, Optima True Grace card, and the Purchasing card–and on it went. Today American Express has 18% of the market.

In the mid 90s, Levi Strauss had 31 percent of the blue jean market. Then, in an effort to appeal to a wider market, they introduced a number different styles and options–baggy, zippered, wide-leg and so on. Today they have 19 percent of the market.

Now what happens when the focus is narrowed?

Delicatessen shops have a history of selling “everything”. Fred DeLuca narrowed the focus to one type of sandwich–submarine. Subway has grown to be a huge success–the eighth largest fast-food chain in America with 13,000 units worldwide.

“Coffee shops” used to have extensive food menus; Starbucks narrowed the focus to coffee.

The Children’s Supermart used to sell all kinds of children’s furniture and toys. They wanted to grow. They narrowed their focus and changed their name. Toys R Us now sells 20% of the toys in the US.

Other examples of this kind of focused positioning include; The Gap = everyday causal clothing, Home Depot = home supplies, Victoria’s Secret = ladies’ lingerie, PetsMart = pet supplies, Blockbuster Video = video rentals, Foot Locker= athletic shoes, Office Depot = office supplies.

Product Positioning Surveys

Finding an exact position for a product or service is done by conducting surveys of a company’s customers and prospects. Fortunately, L Ron Hubbard’s research of the subject lead him to develop highly precise survey techniques that enable one to find a position for a product or service that will communicate instantly to a particular public–a wonderful tool for those of us who are in the business of communicating to people about products, services and ideas.

Positioning lets you create a place for your product in the mind of your prospect. Without it, your marketing, advertising and Public Relations dollars are at risk. With it, the sky’s the limit.